Keystone XL pipeline crosses political boundaries in Nebraska and beyond

PALDING, Neb. — Bob Bernt, a bear of a man, a rancher and a lifelong Republican, had about 25 people over recently for a pork-and-beans cookout.

The ranchers and farmers who drove their pickups to Bernt’s place were almost all Republicans, of one stripe or another. One sported a Ron Paul button. Another said he had lived — until recently — as "no opinion Tom." Some admired the tea party; others derided it.

Opponents of the proposed Keystone XL pipeline gathered in Spalding, Neb., for a cookout to thank state senator Ken Haar for his work to reroute the pipeline away from Nebraska?s Sand Hills and portions of the Ogallala Aquifer. But in spite of this reroute, many of the Nebraskans at this event do not want to see the pipeline built at all.
After an afternoon of floating down a nearby river, sampling Bernt’s organic cheese and ice cream, and listening to a cowboy poet, they sat under a large white tent to talk about what really brought them together: standing up to the big pipeline company TransCanada.

When TransCanada said its $7 billion Keystone XL oil pipeline from Alberta to Texas would pass about two miles from this tiny town in central Nebraska — crossing 92 miles of the state’s ecologically sensitive Sand Hills and parts of the vast Ogallala Aquifer — it stirred opposition throughout the state. Political boundaries crumbled as the pipeline proposal united Nebraskans across party lines and divided them within. Ultimately, it became a political litmus test in the presidential race.

Its route riled Nebraskans who fear water contamination and resent the ability of a corporation — especially a foreign one — to wield the right of eminent domain.

People such as "no opinion Tom" Genung, whose mother-in-law meekly accepted TransCanada’s initial offer, took his protest to Washington, where he was arrested outside the White House. Jim Knopic, who learned about activism fighting big hog-raising companies, got into the fight. And Bernt, who sells beef, dairy products and vegetables, grew upset that he might lose his organic certification if the pipeline crossed under the Cedar River where his cattle drink.

So when President Obama rejected TransCanada’s Keystone XL pipeline proposal, saying his administration needed more time to weigh the environmental impact of the route through Nebraska, he was practicing his own version of "triangulation" politics, playing to environmental groups and making common cause with people in a solidly red state.

"I was really impressed with that," Bernt said of Obama’s decision in January. "He showed more backbone that I thought he had."

Months after Obama had hoped to put the issue to rest, the pipeline remains a confounding political issue with traps for both presidential candidates. GOP hopeful Mitt Romney has played up the issue, but here some conservatives are put off by his unequivocal support for the project with scant mention of its environmental impact.

"Nebraska, even though we’re one of the reddest of red states, we have this prairie populism streak," said Philip M. Young, a political consultant and former executive director of the state Republican Party.

At the same time, Obama must tread carefully in an election year in which Democrats as well as Republicans are seduced by the promise of jobs — even if it may be an illusion. He has backed the 485-mile southern leg of the pipeline from Cushing, Okla., to the Texas Gulf Coast, and last month TransCanada received the last of three permits it needed from the U.S. Army Corps of Engineers to begin construction.

Here in Nebraska, the politics of the Keystone XL pipeline are especially murky. TransCanada has changed the route so that only 10 miles will lie in areas with shallow water sources. The mostly Republican unicameral legislature, which stunned TransCanada by taking a unanimous position against the original path in December, voted in favor of a revised route if it won approval from the governor and the state Department of Environmental Quality. In April, TransCanada submitted its alternative route.

"This coalition forced some odd partnerships," Ken Haar, a state senator who led the fight to alter the route, said at Bernt’s cookout. "People in this area want government out of their lives, yet they are working with [the activist group] Bold Nebraska and the Sierra Club." For his part, Haar won gratitude from farmers and ranchers, but he strained his relationships with construction unions, which support the pipeline.

Of TransCanada’s new route, Haar said, "It’s not a perfect solution, and different people will be unhappy." But he added that most Nebraskans probably think it’s a victory.

Pipeline politics

That victory could spell defeat for Haar, however. He is worried that wealthy pro-pipeline and conservative forces are set to pour money into an effort to defeat him this November. He can already imagine the negative ads.

The politics of the pipeline could also echo far beyond the Nebraska statehouse.

In the race for the U.S. Senate, crucial for Democrats trying to hang onto a majority, former Nebraska governor and former Democratic senator Bob Kerrey has tiptoed around the pipeline issue. His opponent Deb Fischer, a state senator from a Sand Hills region and a favorite of the tea party, was among the legislators in Nebraska to vote unanimously against the pipeline initially, but she now supports it.

On July 4, both candidates dashed from parade to parade, ending the day of more-than-100-degree swelter in Seward, a town of roughly 6,000 whose population increases fivefold every Independence Day. They took their places behind the American Legion band, the Nebraska Mother of the Year and a United Methodist church group singing "You’re a Grand Old Flag."

Fischer, 61, who upset the Republican establishment candidate in the primary, paused under a tree after the parade for some questions.

"I think Nebraska has a process in place. We’ll see what the governor does and the administration does," she said. "I’m in favor of the pipeline being built."

But she is attuned to the eminent domain issue, which rankles Nebraskans, violating their sense of propriety. In 2006, she introduced a bill that became state law to limit the effect of a U.S. Supreme Court ruling in 2005 and restrict the use of eminent domain if it were for "an economic development purpose" or on agricultural land.

There was no mention of pipelines, however, which she now places in a different category. "I understand the feeling of people who face a similar thing whenever a road is built in an area or a transmission line," she said. "Would I want it? No. But that’s what we do in the United States."

Asked about the extra greenhouse gases that would be emitted extracting the heavy oil sands crude that will flow down the pipeline, Fischer said simply: "I’m not going to get into a discussion of climate change."

That, however, is where Kerrey starts. In an interview with the Omaha World-Herald, he said that climate change was a key issue that propelled him into the race.

But Kerrey also told the Omaha newspaper that he had not thoroughly reviewed the pros and cons of tapping Canada’s oil sands. "It may be that that genie’s out of the bottle already," he said, "and if you’re down to a choice of summarily shipping it West and having it end up being sent to China or shipping it south and used by the United States, it’s probably difficult to oppose it at this point. But I haven’t reached an absolute decision on it."

"Bob has taken the position that if they’re going to build it, it is better to send [the Canadian oil] to the United States than to China," his campaign manager, Paul Johnson, said in an interview. "If the appropriate authorities approve it, that’s fine with him."

Job expectations

On the national stage, the politics of the pipeline have little to do with the Ogallala Aquifer or even eminent domain. It has everything to do with promises of jobs and a secure supply of crude oil.

Romney has said that he will approve the Keystone XL his first day in office. "Day One, President Romney immediately approves the Keystone pipeline, creating thousands of jobs that Obama blocked," says the narrator in one of the candidate’s ads.

In April, Romney told state Republican Party leaders at a retreat in Arizona, "I will build that pipeline if I have to do it myself."

Obama has embraced the southern portion that would run from Cushing, a major storage terminal and pipeline hub that is a bottleneck for oil moving south from Canada and North Dakota. And the language Obama used when he rejected TransCanada’s application in January suggested he was open to a revised proposal for the northern leg.

At that time, Obama was being pressed by congressional Republicans who set a Feb. 21 deadline for the pipeline’s approval as part of a two-month extension of the payroll tax cut, an effort to wrangle a permit from the administration.

"This announcement is not a judgment on the merits of the pipeline, but the arbitrary nature of a deadline that prevented the State Department from gathering the information necessary to approve the project and protect the American people," the president said.

Eventual approval might anger Obama’s supporters in the environmental movement, and some major donors have threatened to hold back contributions. But openness to the pipeline falls in line with public opinion. About six in 10 Americans said the government should approve the pipeline while fewer than two in 10 oppose it, according to a Washington Post poll. Even among Democrats, 48 percent say it should be built; while 26 percent say it should not be built.

One reason for the support: 83 percent of those polled said the pipeline, if built, would "create a significant number of jobs" while far fewer, only 34 percent, said it would "significantly damage the environment."

Despite the strong ties between the United States and Canada, the long battle over the Keystone XL pipeline has irritated many Canadian leaders and sparked talk about sending output from Canadian oil sands to China. TransCanada has been working on U.S. permit approvals for nearly four years, and has faced vociferous opposition from environmentalists and scientists worried about the unusually high level of greenhouse gas emissions associated with oil extraction from the tar sands.

During a February visit to Beijing, Canadian Prime Minister Stephen Harper courted Chinese participation in such an arrangement. China’s rapidly expanding economy is thirsty for crude oil, although its ability to refine such oil may be limited.

Chinese firms already own minority stakes in oil sands ventures. Sinopec is one of half a dozen partners in the pit operations of a venture called Syncrude and China National Offshore Oil Corp. owns 17 percent of MEG Energy, which is producing 25,000 barrels a day from a steam-injection project.

Contributing to Harper’s reoriention was President Obama’s decision to reject TransCanada’s initial permit application — which would have routed the pipeline through ecologically sensitive areas of Nebraska — because, Obama said, he could not evaluate the permit properly in the face of a congressional deadline.

"I think we need to be clear. As much as I want to see that Keystone project proceed, this incident underscores the fact it is in this country’s national interest to be able to sell its products beyond the United States," Harper said in an interview with Reuters at the time of his China visit.

On the chance that the Keystone project fails, other pipeline companies are looking into alternative routes. The Enbridge pipeline company has proposed a 732-mile "Northern Gateway" line that would cross the rugged Rocky Mountain terrain and extend to Canada’s west coast for shipment in tankers that would have to navigate some dangerous shorelines. Critics have called it more of a pipe dream than a pipeline; the Enbridge plan faces a host of hurdles, including approval from Canada’s First Nation tribes and environmental concerns, especially in the wake of serious spills on other Enbridge lines.

On Monday, the U.S. Pipeline and Hazardous Materials Safety Administration slapped Enbridge with a record $3.7 million fine for its July 25, 2010, spill of more than 20,000 barrels of crude oil into Talmadge Creek, the Kalamazoo River and Morrow Lake near Marshall, Mich. Many people in the area were sickened by fumes. The agency, part of the Department of Transportation, also announced 24 enforcement actions against the company.

Last month, the Environmental Protection Agency reopened 34 miles of the Kalamazoo River and all of Morrow Lake for recreation, but the Morrow Lake Delta remains closed and Enbridge is still cleaning up.

The natural market

In any case, the United States is still the biggest, most accessible and most reliable market for Canada. Three-quarters of Canada’s exports go to the United States, and 60 percent of its imports come from the United States — because of the size and proximity of the U.S. economy.

Despite the strong ties between the United States and Canada, the long battle over the Keystone XL pipeline has irritated many Canadian leaders and sparked talk about sending output from Canadian oil sands to China. TransCanada has been working on U.S. permit approvals for nearly four years, and has faced vociferous opposition from environmentalists and scientists worried about the unusually high level of greenhouse gas emissions associated with oil extraction from the tar sands.

During a February visit to Beijing, Canadian Prime Minister Stephen Harper courted Chinese participation in such an arrangement. China’s rapidly expanding economy is thirsty for crude oil, although its ability to refine such oil may be limited.

Chinese firms already own minority stakes in oil sands ventures. Sinopec is one of half a dozen partners in the pit operations of a venture called Syncrude and China National Offshore Oil Corp. owns 17 percent of MEG Energy, which is producing 25,000 barrels a day from a steam-injection project.

Contributing to Harper’s reoriention was President Obama’s decision to reject TransCanada’s initial permit application — which would have routed the pipeline through ecologically sensitive areas of Nebraska — because, Obama said, he could not evaluate the permit properly in the face of a congressional deadline.

"I think we need to be clear. As much as I want to see that Keystone project proceed, this incident underscores the fact it is in this country’s national interest to be able to sell its products beyond the United States," Harper said in an interview with Reuters at the time of his China visit.

On the chance that the Keystone project fails, other pipeline companies are looking into alternative routes. The Enbridge pipeline company has proposed a 732-mile "Northern Gateway" line that would cross the rugged Rocky Mountain terrain and extend to Canada’s west coast for shipment in tankers that would have to navigate some dangerous shorelines. Critics have called it more of a pipe dream than a pipeline; the Enbridge plan faces a host of hurdles, including approval from Canada’s First Nation tribes and environmental concerns, especially in the wake of serious spills on other Enbridge lines.

On Monday, the U.S. Pipeline and Hazardous Materials Safety Administration slapped Enbridge with a record $3.7 million fine for its July 25, 2010, spill of more than 20,000 barrels of crude oil into Talmadge Creek, the Kalamazoo River and Morrow Lake near Marshall, Mich. Many people in the area were sickened by fumes. The agency, part of the Department of Transportation, also announced 24 enforcement actions against the company.

Last month, the Environmental Protection Agency reopened 34 miles of the Kalamazoo River and all of Morrow Lake for recreation, but the Morrow Lake Delta remains closed and Enbridge is still cleaning up.

The natural market

In any case, the United States is still the biggest, most accessible and most reliable market for Canada. Three-quarters of Canada’s exports go to the United States, and 60 percent of its imports come from the United States — because of the size and proximity of the U.S. economy.

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